New draft regulations introduced to Federal Parliament earlier this year – set to alter rules around self-managed superannuation funds’ investment in art and collectables – have divided artists, art dealers and professional organisations administering SMSFs.
In public submissions made in response to the draft regulations, introduced to parliament in May and due to be debated at the next Senate sitting in August, independent artists and art dealers were largely opposed to the new rules, while professional associations for superannuation and tax professionals were split on the issue.
The reforms stem from last year’s Cooper Review and stipulate that art held in super funds must not be used, stored by, or leased to any party related to the fund and must be valued independently before any asset purchase or sale.
The new rules also pertain to art being insured in the fund’s name, not by a private individual, and storage records must also be kept for at least a decade.
The Association of Taxation and Management Accountants, the Australian Institute of Superannuation Trustees and the SMSF Professionals Association of Australia supported the new rules, though they did express concern over some detail.
“This is in the interests of all superannuation fund members, and in the interests of the efficient operation of the superannuation system,” AIST said.
SMSF Professionals Association of Australia said art and collectables were a legitimate investment class for SMSFs and the regulations would help facilitate this.
Meanwhile the Institute of Chartered Accountants and the Small Independent Superannuation Funds Association strongly disagree with the proposed new rules.
Local art dealer GFL Fine Art and local doctor and contemporary Australian art enthusiast Michael Levitt opposed the regulations, saying they would cause an influx of art for sale onto the market and would be vastly detrimental.
• See Community & Arts Sector, page 27.